After-hours conduct and its connection to employment

It is no wonder that as technology (accessibility of
employees through email and mobile phones) blurs the borders and
boundaries of the workplace, employers are finding it both
difficult to regulate workplace behaviour "after hours"
as well as finding it a necessity.

The types of after-hours behaviour by employees which end up
being pursued by or against employers in court commonly involve
sexual misconduct (which often involves alcohol), injuries
sustained at events and of more recent times the (mis)use of social
media (the latter being the subject of another article in this
edition of Strateg-eyes).

have employees attending social events connected to their
workplace (eg social events organised by customers, clients or
suppliers)

have employees going away or attending work conferences
together

provide accommodation for employees which results in employees
living in close proximity to each other

are sensitive about reputational and brand damage that may be
sustained by employee misbehaviour

have employees using social media

You're not the fun police, it's the law...

The incentive to regulate employees' behaviour outside the
normal work environment are the legislative obligations which exist
for employers as well as individuals (officers and employees alike)
under both work health and safety and antidiscrimination
legislation.

In particular, the primary duty of care of the person conducting
a business or undertaking ("PCBU") under
the harmonised work health and safety legislation (in New South
Wales this is s.19 of the Work Health and Safety Act 2011)
will apply if the after-hours event involves workers being "at
work in the business or undertaking" . This duty also extends
to ensuring that the "health and safety of other persons is
not put at risk from work carried out as part of the conduct of the
business or undertaking". If the after-hours conduct triggers
this duty, and that will be debateable given the wording of the
duty, then officers and "workers" (employees and a range
of others) are also implicated as they have a duty to either, in
the case of officers, exercise due diligence to ensure the PCBU
complies with its duties or in the case of workers "(w)hile at
work", to take reasonable care of their own health and safety
and to ensure their acts or omissions do not endanger the health or
safety of others (and also to comply with policies and
instructions).

The Sex Discrimination Act 1984 (Cth) makes it unlawful
for employees and other "workplace participants" to
sexually harass each other as well as for an employer to sexually
harass an employee. As regards "workplace participants"
the area within which sexual harassment is regulated is at the
workplace which the Act defines as "a place at which a
workplace participant works or otherwise carries out functions in
connection with being a workplace participant". The incentive
for employers to seek to prohibit unacceptable workplace behaviour
at after hours events is set out in s.106 which provides employers
with a defence to the acts of employees and others, for which they
are (otherwise) vicariously liable, provided they have taken all
"reasonable steps". In the context of sexual harassment
the case of Lee v Smith & Ors1 should
serve as a solemn reminder. In this case part of the conduct
complained about occurred at a private dinner party attended by
work colleagues and where the complainant was allegedly raped by a
work colleague against whom she had previously made complaints
regarding his sexual harassment of her.

In South Pacific Resort Hotels v Trainor2
the sexual harassment which allegedly occurred after hours involved
employees who lived in employerprovided accommodation. This case
recognised that "in connection with employment" could
have a broad application in terms of an employer's liability
for after-hours conduct.

Where does the workplace stop and start?

The work health and safety and anti-discrimination laws provide
the legislative basis enabling and indeed justifying the regulation
of workplace behaviour and the continuation of the working
relationship, such as at a regional conference (see Leslie v
Graham3 ), in a car park used by employees (see
Dobson v Qantas Airways Limited4 ) or where
workplace events led to an afterhours assault (see The
Australian Workers' Union, Tasmania Branch v Adelaide Mushrooms
Nominees Pty Ltd t/a Tasmanian Mushrooms5 ) will
continue the employer's "workplace obligations".

While it was made clear in the context of a workers'
compensation claim in the NSW Court of Appeal recently that work
social events and recreational activities "can well form part
of the course of employment" (Pioneer Studios Pty Ltd v
Hills6 ), equally, it may be that after-hours
conduct does not necessarily fall within the realm of the
workplaces that legislation covers, but there is still a
reputational risk created by employees' after-hours behaviour.
Can an employer still require an employee to behave in a particular
way? The answer is, in short, yes but on what basis? Older case law
based such intervention and regulation on there being a
"relevant connection to employment" 7 and this
case law is still good authority.

This issue was recently considered in John Pinawin t/a
RoseVi.Hair.Face.Body v Edwin Domingo8 where, in
an unfair dismissal context, Fair Work Australia qualified the
notion that "(g)enerally employers have no right to
control or regulate an employee's 'out of hours
conduct'. Fair Work Australia affirmed that "if
an employee's conduct outside the workplace has a significant
and adverse effect on the workplace, then the consequences become a
legitimate concern to the employer. A range of 'out of hours
conduct' has been held to constitute grounds for termination
because the potential or actual consequences of the conduct are
inconsistent with the employee's duty of fidelity and good
faith. This concept is closely allied to the implied term of
'trust and confidence' in employment contracts which
relates to modes of behaviour which allow work to proceed in a
commercially and legally correct manner". In this case
the fact that the employer was a small business with a close
personal relationship with the employee was another basis on which
summary dismissal based on drug use, was justified.

In McManus v Scott-Charlton9 the court held
that an employer may legitimately seek to assert authority over any
conduct which threatens order in the workplace or the reputation of
the enterprise and this proposition has subsequently been approved
in Farquharson v Qantas Airways Limited10 and
Kolodjashnij v Boag11 . The "order in the
workplace" may represent the chain of command such as the
relationship between managers and those under their supervision.
Where conduct has a bearing on that relationship then the
employer's concern about it (and subsequent action) will be
legitimate - Civil Service Association of WA v Director-General
12 ; Gera v Commonwealth Bank 13 ; Kalouche v
Legion Cabs 14 .

And, in this age of social media, insulting and threatening
comments made about another employee after hours but on a public
forum can provide the basis of serious misconduct and summary
dismissal 15 . However, comments made on Facebook that
are foolish and inaccurate outbursts that do not damage an
employer's business may not provide a valid reason for
dismissal 16 . Despite the finding in
Fitzgerald's case, Commissioner Bissett did state
"(i)t would be foolish of employees to think they may say as
they wish on their Facebook page with total immunity from any
consequences".

How do you regulate the behaviour?

The regulation of appropriate, or inappropriate, after-hours
workplace behaviour may be contained within any workplace behaviour
policy or policy on social media, sexual harassment, discrimination
or bullying because whether it occurs during or after work hours,
the types of acceptable and unacceptable behaviour will be the same
and should be treated accordingly. Another policy where conduct may
be regulated is in any applicable drug and alcohol policy.

The only difference between during and after-hours behaviour
will be that after-hours behaviour may be more difficult to link to
the workplace 17 and thus employment in any given
factual scenario, however the authorities, as outlined above, will
allow an employer to take action where there is a connection
between the context in which the after-hours conduct occurs and the
employment and so the fact that such a difficulty may arise (in
terms of a connection) in the future should not be a deterrent to
exercising both in the documentation and practically, an
appropriate level of control. The requisite connection between the
conduct and the employment may be established by the laws referred
to earlier or even where there is a threat to the "order of
the workplace" or the employer's reputation or where the
employee's conduct amounts to a breach of a contractual duty.
As regards breach of contract, such an action may also be available
(in addition to an implied breach of contract) if the
employer's contract of employment with its employees sets out
reasons which may lead to termination (summary or with notice) and
these include conduct which "brings or may bring" the
employer into disrepute.

As with all policies and contractual terms, the sanctions for
any breach should be clear and they should be rigorously
implemented and enforced, consistently as well as updated as may be
required from time to time.

Conclusion

After-hours conduct can legitimately be the subject of employer
regulation and disciplinary action through both the contract of
employment and employment policies if it is necessary either in
order to either ensure compliance with the employer's
legislative work health and safety or anti-discrimination
obligations or if it may cause damage to an employer's
reputation or order of the workplace. It may be, in any given
situation where damage or injury results from an employee's
after hours conduct, that an employer can and should divorce the
connection from employment and the workplace, however, it is
prudent to at all times reserve the right to control actions which
may lead to this liability given the encroachment of the workplace
into people's private lives and the ever-increasing liability
which results.

An employer must comply with any obligation in a modern award or enterprise agreement to consult about the redundancy.

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